What is reseller hosting?

Reseller hosting is a hosting model where you purchase hosting packages from a provider and resell them to your own customers under your own brand name. You act as an intermediary between the hosting provider and end users. This is ideal for web designers, developers, or digital agencies that want to offer hosting to their clients without having to manage servers themselves.

With reseller hosting, you buy a large package with resources (disk space, bandwidth, email accounts) that you can then divide into smaller packages. You resell these packages to your customers, often with a profit margin. The original provider remains responsible for server hardware and technical maintenance, you focus on customer relationships and sales.

This model is popular because it requires little technical knowledge but is a good way to generate additional income. Especially for companies that already build websites for clients, reseller hosting is a logical extension of the service offering.

How does reseller hosting work?

You start by buying a reseller hosting package from a provider. This package contains resources such as 100GB disk space, 1000GB bandwidth, and for example 500 email accounts. These resources are yours to distribute as you wish.

Through a reseller control panel (often WHM - Web Host Manager), you can create individual hosting accounts for your customers. You determine how much disk space, bandwidth, and other resources each customer gets. For example, you can create 20 packages of 5GB each, or 10 packages of 10GB - as long as you stay within your total resources.

Each customer gets their own cPanel account (or another control panel). For them, it looks like they're directly with a hosting company. They see your company name, your branding, and your contact details. The original provider stays in the background.

You determine the prices you charge your customers. If you buy a reseller package for €20 per month and sell 10 hosting accounts for €5 per month each, you earn €30 per month (€50 income minus €20 costs). You determine the profit margin yourself.

Most reseller packages come with white label capabilities. This means you can brand the control panel with your own logo, colors, and company name. For your customers, it looks like they're with your hosting company, not the underlying provider.

Technical support usually works in tiers. The provider offers support for server-related issues (hardware, network, server software). You provide support to your customers for their specific questions (website issues, email settings, etc.). Some providers also offer white label support, where they help customers in your name.

Advantages of reseller hosting

Low startup costs are a big advantage. You don't have to buy servers, rent a datacenter, or hire technical staff. For €15-30 per month, you can start with reseller hosting. This is much lower than the investment needed to set up your own hosting company.

Passive income is possible. Once you have customers, they pay monthly for hosting. You don't have to continuously work on this (except support), which makes it a nice recurring income stream.

Offering extra value to existing customers is simple. If you build websites for clients, you can also provide hosting directly. Customers appreciate the convenience of everything from one source: website development and hosting from the same company.

Complete branding control means you can build your own hosting brand. All communication with customers goes through your company name. This strengthens your brand and increases customer loyalty.

Scalability is built-in. Start with a small reseller package and upgrade as you get more customers. Most providers let you easily upgrade without your customers noticing.

No technical maintenance is a relief for many entrepreneurs. The provider takes care of server updates, security patches, hardware replacement, and network monitoring. You only have to deal with your customers and their websites.

Disadvantages of reseller hosting

Limited control is a reality. You can't choose which software versions to use, which server settings to change, or how security is configured. You depend on what the provider offers. If they use an old PHP version, you have to work with it.

Dependence on the provider can be problematic. If the provider's server goes offline, all your customers' websites go offline. Your reputation is at stake, but you have no direct control over the situation. Therefore, choose a reliable provider with good uptime statistics.

Profit margins are often small, especially in the beginning. If you want to price competitively, there's not much room between what you pay and what you can charge. Your business model must be based on volume (many customers) or added services (design, support, SEO).

Support responsibility lies with you. If a customer has a problem, they expect you to solve it. Even if the problem is with the underlying provider, you have to handle communication and reassure the customer. This can be time-consuming.

Resource limits can limit your growth. If your reseller package is full, you have to upgrade. This can mean you temporarily can't accept new customers, or you have to invest in a more expensive package before the income justifies it.

Reputation risks are real. If the provider delivers poor service but your name is on it, this damages your reputation. Your customers don't know there's an underlying provider - for them, you are the hosting provider.

Who is reseller hosting suitable for?

Web designers and developers who build websites for clients are the perfect target audience. Instead of referring clients to another hosting provider, you can provide hosting yourself. This gives you more control over the technical environment and additional income.

Digital marketing agencies can use reseller hosting to expand their service offering. If you already handle websites, SEO, and social media, hosting is a logical addition. It makes you a one-stop-shop for clients.

Starting web hosting entrepreneurs use reseller hosting to start without large investments. You can test the concept, attract customers, and gain experience before potentially investing in dedicated servers or your own infrastructure.

Freelancers who want a stable income stream can use reseller hosting for passive income. Every client with a website is a potential hosting customer who pays monthly.

IT consultants who provide technical support to small businesses can add hosting to their portfolio. You can then also manage and optimize the hosting environment for your clients.

Entrepreneurs with an existing customer base in a specific niche (e.g., photographers, law firms, local businesses) can offer niche-specific hosting. You understand their specific needs and can create custom hosting packages.

Practical tips for reseller hosting

Choose a reliable provider as a foundation. Your reputation is at stake, so invest time in comparing providers. Look at uptime guarantees (99.9% or higher), fast support, and good reviews. Use comparison sites to compare reseller hosting providers.

Start small and scale gradually. Start with a basic reseller package and upgrade when you have more customers. Don't overestimate how many customers you can quickly attract - it's better to start too small than to have an expensive package with few customers.

Set clear boundaries for support. Determine in advance what support you do and don't offer. "I help with hosting-related questions, but not with WordPress problems" for example. Without boundaries, support becomes a time-consuming cost center.

Automate where possible. Use WHMCS, Blesta, or similar billing software to automate invoicing, account provisioning, and support tickets. This saves an enormous amount of time as you grow.

Calculate your prices realistically. Include not only hosting costs but also your time for support, billing, and administration. A rule of thumb: your purchase price should be a maximum of 40% of your selling price to maintain healthy margins.

Make clear agreements about backups. Are backups included? How often are they made? Who is responsible if data is lost? Document this in your terms to prevent discussions.

Offer additional services to increase your distinctive power. Just reselling hosting is hard to compete with. Combine it with website maintenance, SEO, security monitoring, or performance optimization. This justifies higher prices and increases customer retention.

Monitor your resources actively. Regularly check how much of your reseller package you're using. You don't want a customer to suddenly not be able to work because your package is full. Plan upgrades before you reach the limit.

Test the migration procedure. Ask your provider how customer migration works if you want to upgrade or switch providers. Some providers offer free migration help, others leave you to figure it out yourself. This is crucial for your continuity.

Build a buffer in your resources. Don't sell 100% of your available resources. Keep 20-30% reserve for growth, traffic spikes, or unexpected situations. Otherwise, you'll quickly hit limits.

Communicate transparently with customers. If there's an outage with the underlying provider, keep your customers informed. Transparency builds trust. Pretending nothing's wrong while their site is offline destroys your reputation.

Learn the basics of hosting management. Even though it's reseller hosting, it helps enormously if you understand how DNS works, what SSL certificates are, and how email configuration works. This makes your support much more effective and increases your professionalism.

Frequently Asked Questions

How much does web hosting cost on average?

Web hosting costs between €3 and €15 per month for shared hosting on average. VPS hosting starts around €10-€20 per month, and dedicated servers from €50 per month.

Can I upgrade to a different package later?

Yes, with most hosting providers you can easily upgrade to a larger package when your website grows. This can usually be done without downtime.

Is Dutch hosting better than foreign hosting?

For Dutch visitors, Dutch hosting is often faster due to the shorter distance. Additionally, communication with support is easier and you comply with GDPR legislation.